Libyan oil production plunges after two key refineries close

Libya’s national oil company said gunmen had shut down two important oil refineries. That caused the country’s daily oil production to fall by as much as 330,000 barrels.

The state-run National Petroleum Corporation (NOC) said the armed group shut pump valves at the Sharara refineries, Libya’s largest, and el-Feel. As a result, production in both places stopped.

Prior to the shutdown, Libya’s oil production stood at 1.2 billion barrels per day.

The head of the company Mustafa Sanallah announced the conditions force majeurea legal pretext that allows the company not to fulfill the agreement in the contract due to compelling circumstances that occur beyond its control.

He said the closures cost Libya more than 160 million dinars (Rp 495 billion) in revenue per day.

Sanallah said the NOC had urged the public prosecutor “to take precautionary measures” and uncover “planners, implementers and those who benefited” from the shutdown. The same militia disrupted oil production at the two refineries in 2014 and 2016, he added.

An oil official in the Libyan capital, Tripoli, said the militia that closed the two refineries came from the town of Zintan, which is about 136 kilometers from Tripoli.

Tribal leaders in the area are negotiating with militia leaders to allow oil production to start, said the official, who spoke on condition of anonymity. [vm/lt]